Uniswap proposal main content: Enable the protocol fee switch and introduce the UNI Burn Mechanism, destroying 100 million UNI from the treasury.

On November 11, Devin Walsh, the executive director and co-founder of the Uniswap Foundation, along with Uniswap founder Hayden Adams, officially proposed a joint governance proposal aimed at establishing a long-term operational model for the Uniswap ecosystem, allowing protocol usage to drive UNI burn and enabling Uniswap Labs to focus on protocol development and growth. The proposal mainly includes the following contents: · Enable the Uniswap protocol fee switch and use these fees to burn UNI; · Include Unichain's sequencer fees in the same UNI burn mechanism; · Establish protocol fee discount auctions to enhance the earnings of Liquidity Providers (LPs), while internalizing the value that originally belonged to MEV searchers; · Launch Aggregator Hooks to make Uniswap v4 an on-chain aggregator that charges fees from external liquidity; · Burn 100 million UNI from the treasury, representing the approximate number that should have been burned if the fee switch had been enabled since the inception of the protocol; · Allow Labs to focus on protocol development and growth, including closing interface, wallet, and API fee revenue, and commit to only engaging in projects that align with DUNI interests; · Migrate the ecosystem team from the foundation to Labs, working together towards the goal of protocol success, with growth and development funds provided by the treasury; · Migrate the Unisocks liquidity held by governance from the mainnet's Uniswap v1 to v4 on Unichain and burn LP positions to permanently lock the supply curve. Protocol fees: The Uniswap protocol features a built-in “fee switch” that can only be activated through UNI governance voting. This proposal suggests governance enable this fee switch and introduce an automated UNI burn mechanism. Fee activation plan: To minimize impact, the proposal suggests a phased activation of protocol fees, starting with the v2 pool on the Ethereum mainnet and portions of the v3 pool that account for 80%–95% of LP fees, and then expanding to L2, other L1, v4, UniswapX, PFDA, and aggregator hooks. Unichain sequencer fees: Unichain has been launched for only 9 months, with annualized DEX trading volume reaching approximately $100 billion and annualized sequencer fees around $7.5 million. This proposal recommends that all Unichain sequencer fees (after deducting L1 data costs and 15% allocated to Optimism) be entirely included in the UNI burn mechanism. MEV internalization fee mechanism: The design of the protocol fee discount auction (PFDA) aims to enhance LP earnings and create a new source of fees for the protocol by internalizing MEV (Miner Extractable Value).